The Netherlands Authority for Consumers and Markets (“ACM”) is actively enforcing the cartel prohibition (see our earlier blog), albeit that the major crackdowns in the bunker sector and port and transport sector and on the tendering market have not yet given rise to any (specific) results. If only the fines are considered, 2017 was even a meagre year for the European Commission (the “Commission”) (with some 50% fewer fines than in 2016). But past performance is no guarantee for future results: we are likely to hear more from ACM and the Commission this year.
Resigning ACM Chairman Chris Fonteijn stated during the Competition Law Developments conference that ACM must continue to anticipate various developments. One of the challenges ACM faces is that markets are changing due to technological developments. The Uber taxi service is such a case, as well as the ever-increasing range of services offered by online platforms. Behaviour is also changing. Technological innovations are having a major impact on the way competition between companies takes place. There was much ado recently about the possibility of companies being able to (implicitly) adjust their market behaviour by means of algorithms. The weighing of public interests is also developing. Mr Fonteijn identifies an increasing focus on public interests such as privacy, sustainability, Social Security and protectionism.
In order to deal with these changes, ACM wishes to invest in knowledge on the functioning of markets, such as the investigation into the functioning of the healthcare insurance market and the study of online platforms for video-streaming. ACM also intends to work together with other supervisory authorities. An example is the cooperation between ACM and the German competition authority ("BKartA") in the towage sector. The BKartA entered into settlements for approximately EUR 13 million with towing companies, due to (or as a result of?) the cartel investigations carried out by ACM and the BKartA at towing companies in the Netherlands and Germany.
At the end of last year, Schiphol and KLM offered commitments to ACM regarding the creation of a level playing field. KLM and Schiphol were in close contact on, among other things, KLM’s position in relation to other airlines at Schiphol. According to ACM, those contacts gave rise to the risk of Schiphol not determining its policy independently, but rather adjusting it to KLM’s wishes, which may have restricted the growth opportunities of other airlines.
More information may become available this year on ACM’s cartel investigation into a procurement market (a large one, according to ACM). ACM has been confirmed in its views by the successes in the cartel cases in the home care sector (see our earlier blog) and the demolition sector. In the demolition case the CBb (Dutch Trade and Industry Appeals Tribunal) confirmed that "cover pricing" in tendering procedures constitutes an anti-competitive practice in breach of Article 6 of the Dutch Competition Act.
Digital data investigations are becoming increasingly relevant. ACM makes use in such investigations of the ACM Digital Data Investigation Procedure 2014 (the “Procedure”). Those powers were the subject of two civil actions (preliminary relief proceedings) in which a company attempted to prevent ACM from gaining access to certain documents. Their claims were dismissed in both cases.
The District Court of The Hague, for instance, ruled that ACM is authorised to copy private data on mobile telephones of employees. The Court found that the right to privacy (under Article 8 of the ECHR) is secundary to ACM's power to gain access, provided that adequate safeguards are in place to prevent ACM from obtaining personal data. The Court believed that the Procedure set out adequate safeguards.
The same District Court of The Hague also found that if a company objects to the inspection of documents, ACM may not set aside those objections by referring in general to the selection of search terms used by ACM. Also after ACM has chosen the search terms, a company may still object to the use of certain documents. The Court ruled that companies must be able to present the outcome of that assessment to a judge, however.
At an European level, the automotive sector in particular is still in the firing line. Late last year, for instance, the Commission imposed a fine on Scania of EUR 880 million as the last of almost EUR 3 billion in fines previously imposed on the truck cartel. Scania’s legal action had been delayed because (unlike the other truck manufacturers) it had not settled with the Commission.
The Commission previously imposed fines amounting to a total of EUR 68 million on Campine, Eco-Bat and Recyclex for coordinating lower prices for the purchase of used car batteries of rubbish traders or collectors. The Commission also imposed fines of EUR 27 million on manufacturers of car lighting Automotive Lighting and Hella for breach of the cartel prohibition. The Commission also recently fined Japanese manufacturers of car parts (safety belts, airbags and steering wheels) a total of EUR 34 million. The cartel consisted of coordinating prices and exchanging sensitive competitive information.
Another interesting case is the Commission’s decision that the sanctions imposed by the International Skating Union (“ISU”) on skaters who took part in matches without the ISU’s permission were in breach of the cartel prohibition set out in Article 101 of the Treaty on the Functioning of the European Union (TFEU). The Commission gave the ISU 90 days to amend its regulations in such a way that permission for other matches is granted on the basis of objective, transparent and non-discriminatory criteria that are not aimed at preventing competing skating events. The case was put in motion by a complaint filed by Dutch professional skaters Mark Tuitert and Niels Kerstholt.
A judgment of the Court of Appeal of Arnhem-Leeuwarden has again demonstrated that a party invoking the cartel prohibition in civil proceedings must furnish sufficient facts and produce sufficient evidence. With reference to the Supreme Court judgment in the IATA case, the Court of Appeal ruled that if a party relies on competition law it must provide sufficient information on the facts and circumstances that are essential to the assessment, such as an accurate definition of the market, the market structure and market characteristics in question, and the actual functioning of the relevant market and its impact on the alleged breach. The company that had put forward competition law arguments, failed to do so in the case in question. It is remarkable that the same Court of Appeal had previously ruled that a non-compete clause had the object of restricting competition. This demonstrates that civil proceedings are of casuistic nature and emphasises the importance of careful litigation.